OBIC Co Ltd's Dividend Analysis
Understanding OBIC Co Ltd's Dividend Performance and Prospects
OBIC Co Ltd (OBIIF) recently announced a dividend of $170 per share, payable on a date yet to be confirmed, with the ex-dividend date set for 2024-03-28. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into OBIC Co Ltd's dividend performance and assess its sustainability.
What Does OBIC Co Ltd Do?
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OBIC Co Ltd is a Japan-based IT service management company. Its principal operations are system integration services, system support services, office automation services, and package software services, providing customers with total solution services. The company's business segments include System Integration Services, OBIC7 series ERP software, System Support Services and Office Automation Services.
A Glimpse at OBIC Co Ltd's Dividend History
OBIC Co Ltd has maintained a consistent dividend payment record since 2008. Dividends are currently distributed on a bi-annually basis.
OBIC Co Ltd has increased its dividend each year since 2009. The stock is thus listed as a dividend achiever, an honor that is given to companies that have increased their dividend each year for at least the past 15 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down OBIC Co Ltd's Dividend Yield and Growth
As of today, OBIC Co Ltd currently has a 12-month trailing dividend yield of 1.20% and a 12-month forward dividend yield of 1.39%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, OBIC Co Ltd's annual dividend growth rate was 16.00%. Extended to a five-year horizon, this rate increased to 17.80% per year. And over the past decade, OBIC Co Ltd's annual dividends per share growth rate stands at an impressive 18.80%.
Based on OBIC Co Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of OBIC Co Ltd stock as of today is approximately 2.72%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-12-31, OBIC Co Ltd's dividend payout ratio is 0.44.
OBIC Co Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks OBIC Co Ltd's profitability 10 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. OBIC Co Ltd's growth rank of 10 out of 10 suggests that the company's growth trajectory is strong relative to its competitors.
Revenue is the lifeblood of any company, and OBIC Co Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. OBIC Co Ltd's revenue has increased by approximately 7.70% per year on average, a rate that underperforms approximately 52.75% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, OBIC Co Ltd's earnings increased by approximately 14.00% per year on average, a rate that underperforms approximately 43.54% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 13.80%, which underperforms approximately 46.02% of global competitors.
Next Steps
In conclusion, OBIC Co Ltd's commitment to consistently increasing dividends positions it as a potentially attractive option for income-focused investors. The company's robust dividend growth rate, reasonable payout ratio, and high profitability rank indicate a strong foundation for future dividend payments. However, investors should also consider the growth metrics, which suggest that while OBIC Co Ltd maintains good profitability, its growth rates in revenue, earnings, and EBITDA are lagging behind a significant portion of global competitors. Nevertheless, for those looking to add dividend-paying stocks to their portfolio, OBIC Co Ltd warrants consideration, supported by its history of dividend achievements and financial health. Value investors seeking to discover high-dividend yield opportunities can leverage tools such as the High Dividend Yield Screener available to GuruFocus Premium users.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
